According to foreign media, multinational investment bank Goldman Sachs is expected to lay off more than 3,000 employees this week.
Multinational investment bank Goldman Sachs has reported large-scale layoffs! According to foreign reports, Goldman Sachs is expected to cut 3,200 jobs this week, more than a third of which may come from the core trading and banking operations. Analysts believe that news of Goldman Sachs' layoffs should come as no surprise to most investors, because the investment banking business itself was extremely challenging in 2022. Not only Goldman Sachs, but the entire industry is facing difficulties.
Stephen Biggar, Director of Financial Institutions Research, Argus Research: “So most of the banks have held on to folks for the better part of three quarters here during the downturn. And I think that really says also is that they don't expect the environment to improve very much in the coming quarters, or they wouldn't be, you know, jettisoning a staff at this point.”
Previously, many investment banks, including Goldman Sachs, JPMorgan Chase, and Citigroup, successively announced that they would slash their year-end bonuses. Analysts also warned that this wave of layoffs may spread to the entire financial industry. The financial market has performed significantly well from 2020 to the first half of 2022, benefiting from real estate investments and the quantitative easing policy of the U.S. Federal Reserve. However, as countries have resorted to raising interest rates in order to curb inflation, global economies have also followed suit into a possible recession.
Gerard Cassidy, Head of Equity Bank Strategy, RBC Capital Markets: “As it was called, housing in the financial markets benefited dramatically. Now they've had big pullbacks and as a result, there needs to be an adjustment for the expense levels, primarily employees, that has to be lowered to the reality of the new markets, which are lower valuations than what we saw about a year ago.”
The last large-scale layoffs at Goldman Sachs were during the 2008 financial crisis. This latest wave of layoffs has spread from the technology industry to Wall Street banks. E-commerce giant Amazon laid off at least 18,000 people in one go at the beginning of this year. According to statistics, a total of 1,020 technology companies laid off 150,000 employees last year. This year, nearly 18,000 people have been laid off from the tech industry already and the number is expected to rise.